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Home My WebLink About249-05 RESOLUTION• RESOLUTION NO. 249-05 A RESOLUTION APPROVING AMENDMENT NO. 13 TO THE CONTRACT WITH OPERATIONS MANAGEMENT INTERNATIONAL (OMI) IN THE AMOUNT OF $4,674,829.66 FOR THE OPERATION AND MANAGEMENT OF FAYETTEVILLE WASTEWATER TREATMENT FACILITIES FOR 2006. BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF FAYETTEVILLE, ARKANSAS: Section 1. That the City Council of the City of Fayetteville, Arkansas hereby approves Amendment No. 13 to the contract with Operations Management International (OMI) in the amount of $4,674,829.66 for the operation and management of Fayetteville Wastewater Treatment facilities for 2006. A copy of Amendment No. 13, marked Exhibit "A" is attached hereto, and made a part hereof. Section 2. That the City Council of the City of Fayetteville, Arkansas hereby authorizes the Mayor to sign Amendment No. 13 to the contract with OMI, contingent upon final approval of the FY2006 Budget. PASSED and APPROVED this 20th day of December, 2005. APPROVED: By: ATTEST: By: ................... SONDRA SMITH, City Clerk DAN COODY, Mayor • AMENDMENT NO. 13 TO AGREEMENT FOR OPERATIONS, MAINTENANCE AND MANAGEMENT SERVICES FOR THE CITY OF FAYETTEVILLE, ARKANSAS WASTEWATER TREATMENT PLANT THIS AMENDMENT NO. 13 to the Agreement for Operations, Maintenance and Management Services for the City of Fayetteville, Arkansas Wastewater Treatment Plant dated September 1, 1994 (the 'Agreement"), made effective on the 1' day of January, 2006, by and between the City of Fayetteville, Arkansas whose address for any formal notice is 113 W. Mountain St, Fayetteville, Arkansas 72701 (hereinafter the 'City") and Operations Management International, Inc., with offices at 9193 S. Jamaica Street, Suite 400, Englewood, Colorado 80112 (hereinafter "OMI") is made and entered into for purposes of amending certain provisions of the Agreement, to prevent the facilities covered by the Agreement from being deemed to be used in the trade or business of OMI pursuant to Section 141 (b) of the Internal Revenue Code of 1986, as amended. NOW THEREFORE, the City and OMI agree to amend the Agreement as follows: Article 4.1 is hereby deleted in its entirety and replaced with the following Article 4.1: 4.1 For services rendered during calendar year 2006 the City of Fayetteville shall pay to OMI the actual cost of services performed plus an annualized management fee of Eighty Six Thousand Eight Hundred Forty One Dollars and Thirty Five Cents ($86,841.35). Said fee and estimated cost (base fee) shall be paid in twelve (12) equal monthly installments. The management fee for subsequent years will be determined proportional to the increase in estimated cost. Article 4.3 is hereby deleted in its entirety and replaced with the following Article 4.3: 4.3 OMI estimates the cost for services for calendar year 2006 shall be Four Million Six Hundred Seventy Four Thousand Eight Hundred Twenty Nine Dollars and Eighty One Cents ($4,674,829.81). Details of said cost are shown in Appendix J. The base fee shall be negotiated each year in September for the upcoming calendar year. Should the City and OMI fail to agree, the base fee will be determined by the application of the base fee adjustment formula shown in Appendix F. Upon each contract year renegotiation, OMI shall continue to invoice City of Fayetteville at the previous amount until the new contract year price is agreed upon. Upon written notice agreement between the parties as to the new contract year base fee, OMI shall issue an invoice retroactively adjusting the previous base fee amount. Should the actual expenditures exceed estimated expenditures by more than Twenty Thousand Dollars ($20,000), in any year of this Agreement, specific approval will be obtained from the City prior to OMI incurring additional costs. Appendices B, E, and J are hereby deleted in their entirety and replaced with the attached Appendices B, E, and J. Article 4.8 is hereby deleted in its entirety and replaced with the following Article 4.8: 4.8 OMI agrees to incur up to One Hundred Four Thousand Eight Hundred Fifty Five Dollars ($104,855) per year in lift station odor control direct expenses, including costs for necessary chemicals, pumps, tanks, related equipment and such outside services as needed. These expenses will not include labor and benefits for OMI personnel. OMI will rebate to the City of Fayetteville the entire amount that actual lift station odor control expenses are less than $104,855 in any year of this Agreement. Pagel of 7 Als No, • s. • !49R16!ThJY.. _ .. , v..AS .• This Amendment No. 13 together with the Agreement constitutes the entire agreement between the Parties and supersedes all prior oral and written understandings with respect to the subject matter set forth herein. Unless specifically stated all other terms and conditions of the Agreement shall remain in full force and effect. Neither this Amendment nor the Agreement may be modified except in writing signed by an authorized representative of the Parties. The Parties, intending to be legally bound, indicate their approval of the Amendment by their signatures below. OPERATIONS MANAGEMENT CITY OF FAYETTEVILLE INTERNATIONAL, INC. /3 Rdger BUQuayle Senior Vice President WDate: II12-2-12.005 D:n Goody Mayor Date: APPROVED AS TO FORM: C Kit Williams City Attorney Z ZZ / D 5 Date: Page 2 of 7 • 1 Appendix B LOCATION OF PROJECT B.1 OMI agrees to provide the services necessary for the management, operation and maintenance of the following: a) All equipment, vehicles, grounds and facilities now existing within the present property boundaries of or being used to operate the City of Fayetteville's Wastewater Treatment Plant located at: 1400 North Fox Hunter Road Fayetteville, Arkansas b) All equipment, grounds, and facilities now existing within the present property boundaries of pump stations described as follows: WW1 978 E. Zion Road WW2 4938 Mission Blvd. (Timbercrest) VV V3 Crystal Springs/Salem Road WW4 691 W. Poplar WW5 3896 N. Gregg WW6 3021 N. Old Wire Road WW7 2034 N. County Road 877 WW8 729 W. North Street WW9 1336 N. Porter WW10 716 Futrall Drive WW11 4412 W. 6`" Street WW12 398 N. Double Springs Road WW13 878 S. Stonebridge Road WW14 1820 S. Armstrong WW15 203 E. 29th Circle WW16 3917 S. McCollum Road WW18 202 N. Sandy (Greenland) WW19 988 S. Mallywagnon Road WW 20 3212 N. Highway 112 WW21 1687 S. Happy Hollow Road WW22 630 N. Double Springs Road VVW23 Masters Addition (Country Club - 2) WW24 4071 South McCollum (Airport East) WW25 Willow West (Farmington) WW26 74 S. Kestrel (Sequoyah Preserve) WW27 1031 River Meadows Drive (Stonebridge Meadow) WW28 1603 Plantation Avenue (Heritage Village) WW29 Greenland (Todd Bohannan) WW30 2324 Rupple Road WW31 2318 Internet (Research Park) WW32 478 N. Durango Place (Silverthorne) WW33 4644 N. Crossover Road (Copper Creek) WW34 7572 S. School (Airport South) WW35 3083 W. 6'h Street (Lowe's) WW36 1642 N. Willowbrook Dr. (Skyler Place) WW37 3848 W. Edgewater Dr. (Clabber Creek) WW38 3710 E. Zion Road (Copper Creek II) WW39 2392 N. Kenswick Avenue (Crofton Manner) WW40 1811 S. Cherry Hills Dr. (Stone Bridge Meadow II) Page 3 of 7 An x:4140WIPRMlM4-mot- • .0 tiVu+YM%YPraWmri • • d) The potable water SCADA system at the following locations: W1 215 W. 24" Street W2 844 N. Crossover Road W4 1016 E. Ash Street W5 707 E. Rogers Drive W6 456 E. Baxter Lane W7 707 E. Rogers Drive W8 113 N. Sang W9 1170 E. South Skyline W10 1044 E. Township Road W11 Mt. Kessler W12 Highway 45 Valve Station W13 Fire Tower Avenue (Goshen) W14 Fire Tower Avenue (Goshen) W15 Co. Road # 55 (Round Mountain) W16 Co. Road # 4343 (Benson Mountain) W17 Gulley Road Tank W18 Gulley Road Station 2435 S. Industrial Dr. 12141 Ed Edwards Road Page 4 of 6 Pump Station Pump Station Pump Station Pump Station Ground Storage Tank Ground Storage Tank Elevated Storage Tank Elevated Storage Tank Elevated Storage Tank Elevated Storage Tank Pressure -reducing Valve Ground Storage Tank Pump Station Ground Storage Tank Ground Storage Tank Elevated Storage Tank Pump Station Water & Sewer Ops Center Mt. Robinson Tower Site • Appendix E • VEHICLE AND MOBILE EQUIPMENT DESCRIPTION Unit # Unit Description Year 1092 Ford Explorer 2002 2009 Ford Ranger 4 X 4 1997 239 Ford F150 Flare Side 266 GMC V -Jimmy 1990 284 Ford Ranger 4 X 4 1992 310 Ford F-350 3 -Way Dump 1990 320 Ford F-350 Crew Cab 1999 324 Ford F-350 w/crane 1999 339 Ford F-350 4 X 4 2002 325 Ford F-350 4 X 4 2001 539 Ford CM224 Mower 1994 550 Ford 5640 Tractor w/Loader 1995 551 Ford 3930 Tractor 1995 556 Ford/New Holland 8160 Tractor w/Loader 1997 562 New Holland 8160 Tractor 1999 563 New Holland Tractor 1999 564 New Holland Tractor w/Loader 1999 566 Ford LS55 Lawn Tractor 1999 570 New Holland 95 hp Tractor 2000 644 New Holland Backhoe/Loader 2000 701 Ford 8000 Dump 1983 712 Ford 8000 (Gooseneck) 1983 734 Freight Liner 1987 76 Caterpillar Articulated Tanker 1988 77 Caterpillar Articulated Tanker 1988 806 Case 1150G Bulldozer 1995 82 Sykes 6" Pump/Trailer 1995 900 Generator 1987 9002 New Holland 648 Round Baler 1999 9003 New Holland 1411 Mower 1999 9004 John Deere 348-C Square Baler 1999 9017 New Holland 1411 Mower 2000 9031 E -Z Go Workhorse 2001 9034 Yale Forklift 2001 9037 E -Z Go Workhorse 2002 910 16 Ft. Trailer N/C 1987 927 24' Parker Gooseneck Trailer 1991 959 Bush Hog 2620 Cutter 1995 966 18 Ft. Trailer 1996 969 Lo -Boy Trailer 1996 New Holland Square Baler 2005 988 Hesston Wheel Rake 1998 989 M & W Wheel Rake 1998 990 New Holland 1412 Mower 2005 991 Polaris 500 4 X 4 1998 992 Polaris 500 4 X 4 1998 9021 Volvo Penta 400 RD — Portable Generator at LS #8 Diesel Power 2001 9025 Volvo Penta 400 RD — Portable Diesel Power 2001 Page 5 of 7 Y • Unit # Unit Description Year Generator at LS #9 Hesston Rake 2005 Portable Generator 2005 Page 6 of 7 • Appendix J COST DETAIL The annualized estimated costs for calendar year 2006 are as follows: Direct Labor 8 Benefits Labor Markup Electricity Electrical Markup Other Direct Costs Other Direct Costs Markup Subtotal Fixed Fee Lift Station Odor Control Capital Item Amortization Power Generator Project Equipment Costs Construction Management Total Est. O&M Budget Total Est. Annualized Budget Net Annualized Difference Current 2005 1,671,071.00 501, 321.00 588,480.00 1,306,961.12 130,696.12 4,198,592.00 81,697.86 69,362.00 100,622.00 762,645.00 114,396.75 5,327,252.89 5,327,252.89 Proposed 2006 The following are some of the major reasons for cost circumstances' 1,714,624.83 514,387.45 576,000.00 1,434,090.16 143,409.02 4,382,511.46 86,841.35 104,855.00 100,622.00 4,674,829.81 4,674,829.81 (652,423.08) The Power Generator Project was successfully completed in 2005. Continued increase in the efficient use of technological automation and job -sharing within the OMI network. Continued upward pressure on the cost of labor, fuel, chemicals and vehicle expenses. Fuel costs in particular have had an enormous impact on the cost of sludge hauling and disposal, but an even greater impact on the potential cost of electricity. Ever increasing cost to maintain community -expected high level of performance with many pieces of equipment nearing the end of their life cycle and destined to be replaced or upgraded as part of the ongoing Wastewater Improvement Project. Continued population growth causing a related increase in treatment costs, sludge production and ultimate sludge disposal costs. Additional costs for maintenance of 40+ sewage lift stations during the next year Page 7 of 7 David Jurgens Submitted By • City of Fayetteville Staff Review Form City Council Agenda Items Or Contracts 20 -Dec -05 City Council Meeting Date Water/Wastewater Division Action Required: • s (4.124/41-5- del? z/zo/CSael9 0/4/ griatehd /tJo, , ? Water/Wastewater Department Resolution approving Amendment Number 13 with Operations Management International, Inc. for operation, maintenance and management of wastewater treatment facilities for calendar year 2006. $4,674,829.66 Cost of this request 5400.5100.5328.00 Account Number 02133 0302 Project Number Budgeted Item XX $ 5,196,723 00 Category/Project Budget Funds Used to Date 5,196,723.00 Remaining Balance Budget Adjustment Attached Water/Wastewater Program Category / Project Name Wastewater Treatment Program / Project Category Name Water and Sewer Fund Name Den Dir or City Attomet w� Finance and Internal Service Director Mayor Comments: 3'/a1w bS Date /}//25 Date Date Previous Ordinance or Resolution # Original Contract Date: Original Contract Number: 1 -Sep -94 1 • • ayF e tEVTIlc City Council Meeting of December 20, 2005 CITY COUNCIL AGENDA MEMO To: From: Date: Subject: Mayor and City Council David Jurgens, Water/Wastewater Director November 29, 2005 Resolution approving Amendment Number 13 with Operations Management International, Inc. for operation, maintenance and management of wastewater treatment facilities for calendar year 2006. RECOMMENDATION Fayetteville City Administration reconunends approval of Amendment No. 13 to thc Agreement between thc City and Operations Management, International, Inc. (OMI), For Operations, Maintenance, and Management Services for the City of Fayetteville, Arkansas Wastewater Treatment Plant." "this contract amendment totalling $4,674,829.66 provides services for 2006 and is included in the proposed Fiscal Year 2006 Budget. BACKGROUND The City of hayuteville's first private operating contract commenced in 1987 with this year marking 19 years of privatized services from Operations Management International, Inc. (OMI). In May of 2003, Fayetteville City Council approved Amendment No. 9 extending this agreement through December 31, 2008. The scope of services provided by OM1 to the City of Fayetteville include: (I) operate and maintain the Noland Wastewater'freatment Plant; (2) operate and maintain 40 wastewater pumping stations; (3) administer the City's NPDES discharge permit, (4) manage the City's sludge disposal program; (5) implement the City's industrial pretreatment program; (6) support the SCADA (supervisory control and data acquisition system) network that monitors water/wastewater facilities; (7) pursue operation economies, efficiencies, and permit compliance; and (8) actively participate in the design and construction of the Wastewater System Improvement Project providing technical, operational, and maintenance input. To encourage operational economy and innovation, an incentive provision is incorporated within the contract whereby budget underruns are distributed 87.5% to the City and 12.5% to OMI. DISCUSSION The operating expenses for fiscal year 2006 contain a slight increase from 2005 due to significantly higher fuel and chemical costs, a 2.6% labor increase, a 3% customer base increase, addition of four sewer lift stations, a 5% increase in hydraulic loadings, and a 10% increase in organic loadings and the resultant sludge hauling. The annual increase in contract value is 5%. BUDGE I' IMPACT fhe full value of $4,674,829.66 of Contract Amendment No. 13 with Operations Management International is included in the proposed budget for Fiscal Year 2006. The approval of Contract Amendment No. 13 is consistent with the City's financial management plan. The authorization of Amendment No. 13 will be conditioned upon the approval of the 2006 budget. Agnida Request-ANnaidmenl No. 13. Dn:05.doc RESOLUTION NO. A RESOLUTION APPROVING AMENDMENT NO. 13 TO THE CONTRACT WITH OPERATIONS MANAGEMENT INTERNATIONAL (OMI) IN THE AMOUNT OF $4,674,829.66 FOR THE OPERATION AND MANAGEMENT OF FAYETTEVILLE WASTEWATER TREATMENT FACILITIES FOR 2006. BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF FAYETTEVILLE, ARKANSAS: Section 1. That the City Council of the City of Fayetteville, Arkansas hereby approves Amendment No. 13 to the contract with Operations Management International (OMI) in the amount of $4,674,829.66 for the operation and management of Fayetteville Wastewater Treatment facilities for 2006. A copy of Amendment No. 13, marked Exhibit "A" is attached hereto, and made a part hereof. Section 2. That the City Council of the City of Fayetteville, Arkansas hereby authorizes the Mayor to sign Amendment No. 13 to the contract with OMI, contingent upon final approval of the FY2006 Budget. PASSED and APPROVED this 20th day of December,,200 . 1 ,/-\ APPROVE C DAN CI ODY, Mayor . Clarice Pearman - Res 249-05 From: Clarice Pearman To: Jurgens, David Date: 12/28/05 1:09PM Subject: Res. 249-05 David, Attached is a copy of the above resolution passed by City Council, December 20, 2005 regarding the agreement with OMI. I will forward to you via interoffice mail two of three original agreements. CC: Bell, Peggy; Deaton, Vicki Page 1